That's not what they are doing. Killing someone who is armed and threatening others is not something new. If they killed him after he was captured him it would fit that description. Why should he have been given a chance to either kill more right then or get away and kill more later? That's just nuts. By your logic, if someone breaks into your home and is about to kill your spouse and you shoot him you are "acting as judge, jury and executioner".
This is why the question “how much time passed between when he fired his last shot” is important. It has been reported the police had been negotiating with him for more than an hour.
Did he really pose an immediate threat, or did the police, for their own reasons, simply decide to end it all with a (literal) bang?
When (if) the whole story comes out, then the world will know for certain f DPD took the law into its own hands.